Note: This article corrects another to show Correa interview was in New York, not Washington

By Eduardo Garcia

LA PAZ (Reuters) - Forty years after his death, Ernesto "Che" Guevara is still revered by many in Latin America but his calls for armed insurrection and class warfare now seem outdated in a region that has largely embraced democracy.

A new generation of socialist leaders has come of age since the Argentine-born guerrilla leader was captured in the Bolivian jungle and executed on October 9, 1967.

Those new socialists -- Venezuela's Hugo Chavez, Ecuador's Rafael Correa and Bolivia's Evo Morales -- all pay homage to Che and are happy to perpetuate the romantic image of the dashing outlaw with flowing locks and a soldier's beret.

Some of their goals are the same with all three imposing much stronger state control over the oil and gas industries.

But unlike Guevara, they all sought and found power peacefully through the ballot box. Their buzz words are resource nationalism and indigenous rights, not dialectical materialism and Marxism.

Latin America has changed radically since Guevara's era. The civil wars and military dictatorships which once ravaged the region have in most cases ended, allowing for democratic change that makes armed revolution redundant.

"In the 1960s and 1970s, people rightly took up arms to change a system, a model, in search of justice and equality," Bolivian President Morales told Reuters this week when asked about Guevara's legacy. "But these are different times."

Morales, who is Bolivia's first democratically-elected indigenous president, has a portrait of Guevara made of coca leaves on the wall of his presidential palace in La Paz and speaks of the guerrilla leader in reverential tones.

"After 40 years, Che is still a symbol of liberation, of sovereignty, dignity and above all of justice and equality," said Morales, who is expected to attend commemorative ceremonies this weekend in the remote region of Bolivia where Guevara was captured by U.S.-backed soldiers and executed.

But such reverence is perhaps on the wane.

COLD KILLER?
Only last month, a new biography, "The Hidden Face of Che," depicted Guevara as a cold-hearted killer who oversaw executions and presided over a "purifying commission" in Havana after helping Fidel Castro seize power in Cuba in 1959.

Brazil's most widely read weekly news magazine Veja published a highly critical article on the cult of Guevara this month entitled "Che -- The Farce of the Hero."

In Venezuela, President Chavez lauds Guevara but has named his own socialist revolution after South America's 19th century liberator Simon Bolivar, not Guevara.

In Ecuador, President Correa has sung songs in public in tribute to Guevara but says his government is concerned with present day problems and not the struggles of the 1960s.

"Che was one of the greatest Latin Americans in history, but ours is 21st Century socialism," Correa told Reuters in a recent interview in New York.

"We don't believe in class war or dialectical materialism. We believe it's possible to bring about profound, radical, socialist change using current structures, democratic means."

Armed rebel movements have put down their guns across the region in recent years. Only Colombia's guerrillas are still a powerful force, and they have become increasingly active in smuggling cocaine.

"THE MOST FAMOUS FACE IN THE WORLD"
Although he no longer inspires admirers to insurrection, Guevara is a potent anti-establishment symbol for some born long after he was fomenting revolution from Cuba to the Congo.

"I think his stance is pretty interesting, although it's a shame that rather than starting a revolution in our country he went elsewhere," said Noelia Gabriel, a 23-year-old student on the streets of Buenos Aires this week.

Guevara is still a merchandiser's dream. "The most famous face in the world," as it has been dubbed, is still reproduced endlessly on T-shirts, mugs, magazine covers -- even bikinis.

The 2004 hit film "The Motorcycle Diaries," which chronicled Guevara's formative trip through South America in 1952, helped bring his legacy to a younger audience, but it also perhaps altered it, portraying him as a sometimes naive idealist rather than a seasoned ideological warrior.

A commemorative concert marking the 40th anniversary of his death is planned in the Chilean capital Santiago and hundreds of Che acolytes will likely join Morales at events in Bolivia.

Perhaps the most poignant ceremony will take place in Santa Clara, Cuba, where Guevara won a famous battle during the Cuban revolution and where his bones now lie.